Miller files, lot 53 D 26, “Venezuela”

The Deputy Assistant Secretary of State for Inter-American Affairs (Mann) to the Ambassador in Venezuela (Warren)


Dear Fletch: Ed Miller has referred to me for reply your letter of January 24, 1952.1

As you know, the premise on which the policy rests—and which I believe to be sound—is that contributions by American-owned companies to the political campaigns of particular groups render the companies vulnerable to charges of partisanship and intervention. We believe that the long term interests of American-owned companies are best served by their observance of strict impartiality in local politics.

The suggestion that contributions can be considered as directed against the communist simply doesn’t hold water for, unless conditions have changed greatly since I was there, communist strength is relatively small compared with that of the COPEI, URD and Accion Democratica supporters. If it should become known that contributions to the government party have been made, all three of these non-communist groups would be antagonized and no one can be sure that one or all of them will not one day exercise political power in Venezuela.

If contributions were made in order to obtain concessions, the concessions, if they were granted, would be tainted with fraud which; if established later, would probably be considered by most Venezuelans ground for their cancellations. Not only would the concessions obtained [Page 1595] through fraud be in peril but the investments in them as well. The position of other concessions not tainted with fraud would likewise be weakened.

We therefore believe that Mr. Proudfit’s decision was a wise one and I hope that he will hold to it regardless of what other companies may do. I believe he was also wise in passing the buck, as it were, to the Embassy which is in a better position than Creole to resist pressure for contributions.

As for the other companies, I hope they will do likewise though I have no doubt that a few individuals will be tempted to repeat, in a different form, the mistake made a few years ago when a petition condemning Accion Democratica was signed by a number of American citizens.

It is, as you say, extremely difficult to ensure that the oil industry will present a united front on this issue. As a practical matter, we do not have the power to force them to accept our advice. I never subscribed to the theory that an American-owned company making a contribution forfeits all claim to protection by our Government. It might be possible that the circumstances surrounding the contribution would be so flagrant that we would be unable to give effective protection if action were taken by the local government to punish the company for intervention; but even within these narrow limits I believe that the prudent thing is to avoid discussion of the degree of protection which we might or might not decide to give in the future.

It seems to us that the problem of bringing about a united front is essentially one of tactics which you are in a better position to judge than we. I assume that Mr. Proudfit would, if he has not already done so, present the Department’s and Embassy’s views to his colleagues. If you believe that informal conversations between you and the heads of companies would have good results, there would be no objection to your discussing the problem with them informally on the basis of their self-interest. I think this largely depends on your personal relationships with people like Bill Woodson. Perhaps Mr. Proudfit would have some suggestions on whether this or some other kind of an informal approach would, under present circumstances, be helpful.

I am sorry I am unable to be more explicit but the tactics must, I think, be made to fit the local situation. In any case, I am sure that we will agree that whatever is done should be done quietly and in a friendly manner and that the Embassy should report any such political contributions which come to its knowledge.


Thomas C. Mann
  1. In his letter, Ambassador Warren informed Assistant Secretary Miller that Mr. Proudfit had been asked to make a contribution to the campaign fund of the party in power in Venezuela on the grounds that Communists were aligning themselves with opposition forces for the forthcoming elections. He further stated that Mr. Proudfit had refused the request, but in view of the possibility that other firms would be approached, the problem for the Embassy was how to assure a united front among the American-owned oil companies (Miller files, lot 53 D 26, “Venezuela”).